Strong off-field performance for Wolves as profits rise considerably

Wolverhampton Wanderers has revealed the football club made a profit of almost £6m last year in what proved to be a pivotal year for the Championship side.

For the year to May 31, 2016, a period in which the club finished 14th in the Sky Bet Championship, the club made a pre-tax profit of £5.831m (2015: £731,000).

Shortly after the period-end, ownership of the club changed hands when Steve Morgan sold up to the Fosun Group.

The most significant aspect of the profit growth was the £7.4m increase in the profit on sale of players’ registrations due to the transfers of Richard Stearman to Fulham in the summer of 2015 and of Benik Afobe to AFC Bournemouth in January 2016 for a reported £10m. Stearman has since returned to the club.

Players signed in the year included Conor Coady, Michael Zyro, Joe Mason and Mike Williamson.

Although the pre-tax profit again benefitted from the release of part of the exceptional onerous contract provision made in 2013, after the relegation to League One, this figure in the year under review was only £2.6m compared to £6.7m in the year to May 2015.

Turnover for the year rose to £27.25m from £26.4m, primarily due to the increased central distribution relating to new television contracts and an increase in match facility fees.

While the average home league attendance fell to 20,157, the net income shortfall produced (£250,000) was mostly offset by an increase in commercial income (£200,000).

The year to May 2016 was the last in which the club received a parachute payment in relation to its Premier League status, which ended in May 2012.  The receipt in the year to May 2016 was £10.8m.  Part of the shortfall will be offset by qualifying for an increased English Football League distribution in the year to May 2017.

The balance sheet at the end of May 2016 remained strong with net assets of £55m and net current liabilities little changed from the previous year end at less than £2m.